Thursday, February 21, 2008

Would you like a spare with that used Leopard?

Updated below.

The purchase of used Leopard 2 main battle tanks from the Netherlands and the 20 loaners from Germany just took on the look of the Upholder/Victoria class submarines. From the Vancouver Sun:
Just months after the Defence Department claimed it had enough spare parts for its Leopard tanks, military officials are buying surplus armored vehicles to strip down for components so Canadian tanks can keep operating in Afghanistan.
This is worth a look back. In April 2007, when this was suddenly sprung on the Canadian public, the total cost of purchase and refurbishment, including 20 operational loaners from the German Bundeswehr was announced as $650 million.
The total project cost of the loaned tanks, the acquisition of 100 surplus tanks from the Netherlands, the requisite upgrades and enhancements to this new Leopard 2 fleet, and an initial acquisition of spare parts is $650 million, which will be funded from existing departmental allocations.
Then in May things took something of a leap.
Canada's purchase and long-term support of 100 slightly used Leopard 2A6 battle tanks will be $1.3 billion — roughly double the Conservative government's initial public estimate last month.

As he detailed a laundry list of military hardware the Conservative government plans to buy over the next few years, Defence Minister Gordon O'Connor surprised the Commons by announcing there will be a 20-year, $650-million service contract attached to the tank deal.

“The capital acquisition is $650 million and the support for 20 years is about $650 million; about the same range,” he said in reply to an opposition question during debate over Defence Department estimates.

And now, we're buying 15 more surplus Leopard 2 MBTs to cannibalize for spare parts.
In regards to the new purchase of 15 surplus tanks for spare parts, MacKay's office issued an e-mail which reiterated that the Leopard 2s are an invaluable asset to Canadian commanders.

"The procurement of surplus German vehicles will provide the Canadian Forces with valuable platforms for training, testing and, where applicable, spare parts," the e-mail stated. "This acquisition fills the short-term needs of the military and demonstrates the judicious use of public resources by this government."

Privately, military officials said the 15 tanks won't be used for training or testing and that they are all destined to be stripped down for parts.

So, let's see now, former Defence Minister Gordon O'Connor started off by telling us the cost was $650 million, quietly tried to sneak the fact by everyone that the cost was actually double that amount and now, we have 15 more surplus tracks being delivered which were unannounced and nobody seems to be talking about cost. Current Defence Minister Peter MacKay hasn't been heard from on this.

Germany waived the lease fees on the 20 loaned tanks so the capital acquisition originally announced was worth about $6.5 million per tank for the Dutch tanks. The 15 surplus tanks appear to be coming from Germany. Even at 1/2 the price, that means an additional cost of $48 to $50 million has just been tacked on to the original purchase.

Then there is this promise which was intended to soften the blow:

This acquisition represents a significant opportunity for Canadian industry. Once negotiations are complete, the Dutch Leopard 2 tanks will be transported to Canada where they will receive the necessary upgrades to final Canadian Forces standards.
Apparently, that too has changed.

But some Canadian industry officials worry the project has now gone off the rails.

They say work to refurbish the used tanks, that was supposed to be awarded to Canadian firms, is now going to European companies and there are questions whether domestic industry will reap that many benefits from this major purchase.

That may be due to the logistics involved and the cost of moving them. To deliver the Dutch tanks to Canada for refurbish and upgrade and then transport some of them back to Afghanistan (if they are completed in time for use in that theatre) would be hugely expensive.

While we're on this subject, this statement needs a look.

The tanks being loaned from Germany are fully operational, and will be deployed to Afghanistan in conjunction with the next rotation of personnel this summer.

These tanks are able to operate in intense heat as their electric turret systems and more powerful engines generate significantly less heat when operating than the hydraulic systems of Canada’s 30-year-old Leopard 1 fleet. They will also be fitted with climate control systems once in theatre.

Anybody could be excused for believing that the loaned German tanks were going to be fitted with air-conditioning to make them more habitable for the crews in the intense heat of the summer. That, however, did not happen. Because the German tanks are on loan there were limits put on modifications. The fully electric turret is cooler than the older Leopards since it no longer needs a hot hydraulic pump to operate but "climate control" is not a good description of what is actually in place. Crews wear a cooling vest.

All in all, this has been a full court press of Conservative dishonesty and obfuscation.

Something has been bugging me about this: It strikes me that the "fee-free" German loan of 20 operational main battle tanks is more than a little generous. In fact it seems to be more than one could expect without some sort of deal having been stuck. What possible arrangement was made with the German government to get 20 combat-ready up-to-mod tanks?

1) We'll lend you 20 good tracks if you purchase 15 more of our surplus rigs;

2) We'll lend you what you need in theatre if we get the contract to refurbish the Dutch tanks you're buying;

3) Here's 20 tanks. We don't want to hear one word from you about moving German troops into southern Afghanistan;

4) Something else.

I know it's pure speculation so if anyone has anything which might make more sense or actually has anything concrete drop it into comments.

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